Source : INDIA TODAY NEWS
Benchmark indices opened marginally higher on Wednesday as falling crude oil prices and positive Asian markets offered support, although continued foreign fund outflows and persistent geopolitical concerns limited the gains.
At 9:27 am, the Sensex was trading at 74,677.91, up 148.83 points, or 0.20%, from its previous close of 74,529.08. The index opened at 74,648.32. The Nifty 50 was at 23,372.60, higher by 43.60 points, or 0.19%, after opening at 23,352.15.
The market opened on a cautious note despite crude oil falling below the $100 mark. Investors are also tracking the ongoing Middle East conflict and continued selling by foreign investors, which has kept sentiment under pressure.
CRUDE FALLS BELOW $100
Crude oil prices continued to ease, providing some relief to Indian equities.
At the time of the market update, Brent crude was trading at $98.18 a barrel, down 1.08%, while WTI crude stood at $89.07, lower by 1.60%.
The fall in crude prices is important for India as sustained lower oil prices can ease inflationary pressure and concerns around the country’s import bill. However, geopolitical risks remain an overhang for the market.
Dr V K Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said the market structure remains technically weak with a downward bias and that a sharp fall in crude prices could provide a trigger for a change in sentiment.
“But that is not happening even though Brent crude has dipped below $99,” he said.
He added that a decline in US bond yields could provide another positive trigger, but that was unlikely in the current macro environment of high inflation, particularly in developed countries.
FII SELLING REMAINS A CONCERN
Foreign investor selling continued to weigh on the market.
Provisional data showed that foreign investors sold Indian equities worth Rs 3,809.99 crore on Tuesday. This was their eighth selling session in the last nine trading days.
Foreign investors have sold Indian shares worth $1.81 billion so far in September, taking year-to-date outflows to $25.87 billion.
The continued selling has limited the impact of positive global cues and lower crude prices on Indian equities.
Global cues were positive on Wednesday.
Asian shares were headed for a sixth consecutive session of gains, supported by signs of continued consumer demand for AI-related applications and strength in technology stocks.
MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.7%.
This provided some support to Indian equities at the open, although the domestic market remained cautious because of foreign fund outflows and geopolitical uncertainty.
BAJAj FINANCE, BAJAJ FINSERV LEAD GAINS
Bajaj Finance was the biggest gainer among the Sensex stocks, rising 2.05%, while Bajaj Finserv gained 1.64%.
Tata Steel rose 1.16%, Asian Paints gained 1.04%, Larsen & Toubro advanced 0.80% and UltraTech Cement rose 0.79%.
Kotak Mahindra Bank and Adani Ports gained 0.70% each, while Hindustan Unilever rose 0.53% and Titan gained 0.51%.
IndiGo, ITC, Trent, Sun Pharma, Eternal, SBI, NTPC and Maruti were also trading higher.
On the other hand, TCS fell 0.63%, Infosys declined 0.61%, HDFC Bank dropped 0.41%, M&M fell 0.41% and ICICI Bank declined 0.17%.
IT stocks continued to weigh on the market after coming under pressure in the previous session.
At 9:27 am, the Nifty IT index was down 0.39%.
TCS was the biggest loser among the major IT stocks, down 0.63%, while Infosys fell 0.61%. HCLTech declined 0.06% and Tech Mahindra was marginally lower by 0.05%.
Investors remain concerned about the medium-term demand and earnings outlook for the sector.
BROADER MARKET OUTPERFORMS
The broader market was stronger than the benchmark indices in early trade.
The Nifty 100 rose 0.25%, while the Nifty 200 gained 0.28% and the Nifty 500 advanced 0.32%.
The Nifty Midcap 50 and Nifty Midcap 100 gained 0.24% and 0.36%, respectively, while the Nifty Smallcap 100 rose 0.60%.
India VIX, the market’s volatility gauge, fell 1.52% to 10.83.
Vijayakumar said domestic liquidity was supporting the broader market, with good growth and better growth prospects attracting investment into several mid- and small-cap stocks.
However, he cautioned that valuations in these segments were getting stretched, creating a gap between attractively valued large-caps and highly valued mid- and small-caps.
Sectoral performance was largely positive at the open.
Nifty Metal was the strongest sectoral gainer, rising 1.14%, while FMCG gained 0.62%. Financial Services Ex-Bank rose 0.75%, MidSmall Financial Services gained 0.50% and Chemicals advanced 0.49%.
PSU Bank rose 0.42%, Realty gained 0.46% and Financial Services 25/50 advanced 0.26%.
Nifty IT was down 0.39%, while Media declined 0.21%. Consumer Durables gained 0.43%, Oil & Gas rose 0.14% and Pharma was marginally higher.
The market is likely to remain sensitive to movements in crude oil, foreign fund flows and developments around the Middle East conflict.
Brent falling below $100 is a positive for Indian equities, but Vijayakumar said the market would need a sharper decline in crude or a meaningful fall in US bond yields to see a significant change in its current structure.
For now, domestic liquidity continues to support the broader market, while elevated valuations in mid- and small-caps and continued FII selling remain key factors for investors to watch.
(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)
– Ends
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SOURCE :- TIMES OF INDIA
